Canadian economy may be slowly recovering from Covid-19 blow, economic struggles continue
Overall, 17 out of 20 industrial sectors posted increases in May and both goods-producing and service-producing industries rose.Updated: Aug 01, 2020 10:29 IST
As sectors of the Canadian economy gradually open up in a phased manner, the country recorded a rebound of sorts with growth in real gross domestic product or GDP at 4.5 percent in May.
The country’s data agency, Statistics Canada or StatCan predicted, based on preliminary information, that the figure for June could increase to 5 percent. However, Canada’s economic struggles are far from over, as StatCan noted in a release, “While May’s gains offset some of the March and April declines, economic activity remained 15% below February’s pre-pandemic level.”
It also put out a flash estimate of a 12 percent decline in real GDP in the second quarter of 2020, which if it holds, will be a historic fall for the country. Real GDP is the gross domestic product corrected for inflation.
Overall, 17 out of 20 industrial sectors posted increases in May and both goods-producing and service-producing industries rose. These economic difficulties are also reflected in the number of people utilising government rescue programmes introduced due to the adverse impact of the Covid-19 pandemic.
Approximately 8.5 million people have taken advantage of the Canada Emergency Response Benefit or CERB, which allows for those rendered unemployed or underemployed by the coronavirus crisis to claim CA $2,000 per four week period spanning six months.
The government had estimated the programme would cost about CA $ 80 billion, and about three-fourth of that budgeted amount has already been disbursed.
While the CERB is going to end in September, Canadian officials have said it is likely that those eligible could be brought on to an improved version of the Employment Insurance which existed before the pandemic.